Jolley: Five minutes with Rick Berman defending the CCF

Shortly after my interview with Wayne Pacelle appeared, I received an email message from Allison Miller, Senior Media associate for the Center for Consumer Freedom (CCF). She wrote, “I read your 5 minutes piece with Wayne Pacelle today. I was hoping you might be interested in speaking with Rick Berman, the Center for Consumer Freedom’s Executive Director. There were several charges unfairly leveled against our organization and Rick personally by Pacelle. Rick would like the chance to set the record straight for your readers and directly respond to Pacelle’s false statements.

The Center for Consumer Freedom is an interesting non-profit organization. To understand it, here is some background information, courtesy of Wikipedia: “The Center for Consumer Freedom (CCF), formerly the Guest Choice Network, is an American non-profit firm that lobbies on behalf of the fast food, meat, alcohol and tobacco industries. It describes itself as "dedicated to protecting consumer choices and promoting common sense," and defending "the right of adults and parents to choose how they live their lives, what they eat and drink, how they manage their finances, and how they enjoy themselves.

“CCF was set up in 1995 by Richard Berman, executive director of the public affairs firm Berman and Company, with $600,000 from the Philip Morris tobacco company to fight smoking curbs in restaurants. Berman told The Washington Post that CCF is now funded by a coalition of restaurant and food companies as well as some individuals;[2] according to the group's website it is supported by over 100 companies and thousands of individual consumers.[1] Sponsors are reported to include Brinker International, RTM Restaurant Group (the owner of Arby's), Tyson Foods, HMS Host Corp, and Wendy's.”

In the interest of fairness, I thought it was important to offer Berman equal time and we conducted the interview using the same format. I emailed the questions to him and I’m reproducing his answers exactly as he wrote them. No editing on my part. I’ll leave the decision about the validity of any statement made by Pacelle or Berman up to you.

I encourage you to read both interviews carefully and then leave your comments at the end of either column.

Q. A few weeks ago, I interviewed Wayne Pacelle and one of the major issues we discussed was a HumaneWatch news release about some alleged discrepancies in the HSUS tax return. He dismissed HumaneWatch as a project of the “discredited Center for Consumer Freedom,” stating the Washington Post and USA Today had called you out as a shill for industry groups and 60 Minutes had called you ‘Dr. Evil.’

Would you talk about your business as well as respond to Pacelle’s charges?

A. It’s always amusing listening to Wayne Pacelle struggle to twist the truth to fit his warped reality. 60 Minutes never dubbed me “Dr. Evil,” but simply reported that it’s a moniker my labor union detractors employed (my friends also use it jokingly). Wayne also claims we “oppose anti-drunk driving campaigns” when in fact we support tougher drunk-driving laws—just not as draconian as some of the laws being pushed by MADD or others. In fact, MADD’s founder worked with our public affairs firm after she left the group.

Pacelle would lose an immense amount of support if his donors knew that HSUS was just PETA with a suit and tie, and he is desperate to tear down anyone who challenges his façade.

As for my business, Berman and Co., we manage several free-market non-profits and a trade association and provide traditional advertising and public-relation services to outside clients. It’s not an unusual structure, and Berman and Company’s ability to secure good ad rates is one reason that on paper it looks like a lot of money goes from these non-profits to my company. It does, but it doesn’t stay there—it then largely goes out the door to newspapers and other media companies or to pay a staff of 30 people.

Pacelle regularly acts as if money coming through my company like this is some kind of personal enrichment scheme. He bizarrely has obsessed on the fact that—after 45 years of working in the business world— I have a nicer house than he does. He even hired a man to take pictures of my home and videotape my car. It’s erratic behavior, especially since Pacelle himself pulls in $300,000 a year in compensation (that we can trace). Wayne often makes these claims while at the same time complaining that we run millions in advertising against his organization—he can’t have it both ways.

Q. What can you tell me about the funding of HumaneWatch?

A. HumaneWatch is a project of the Center for Consumer Freedom, which openly discloses support from foundations, restaurants, the food industry, and individual consumers. Like most non-profit groups, we don’t disclose individual donors. Melanie Sloan of CREW, a left-wing group that opposes us, attacks us for not disclosing our supporters Yet she herself says “I wouldn't have any donors if I revealed all my donors.”In fact we have a long list of anti-business groups that refuse to disclose donors. And you certainly won’t catch Wayne Pacelle revealing any sugar daddies of HSUS.

Q. About that tax return - talking about their donations to local animal shelters, Pacelle said “Let me underscore that HSUS is not a grant-making group or a foundation, just like the American Farm Bureau Federation or the National Rifle Association are not grant-making groups. Does the NRA just fund gun ranges, or the Farm Bureau fund farms, or the AARP fund senior citizen centers?”

Does he have a valid defense?

A. As usual, it’s more flimflam from Wayne. This time he is comparing apples and oranges. There are hundreds if not thousands of groups with “humane society” in their name, whereas that’s not true about “rifle associations.” And the AFBF is indeed affiliated with state-level Farm Bureaus. That’s not true for HSUS and local humane societies.

Confusion among the public is vast and Pacelle surely knows it. He can try to talk around it, but that won’t change reality. We hired Opinion Research Corporation (CNN’s pollster) to survey the general public and found that 71 percent mistakenly believe that HSUS is an umbrella group for pet shelters. Even HSUS’s own donors are confused. We surveyed 1,000 self-identified donors and found that the vast majority gave to HSUS to support shelters or to reduce the pet euthanasia rate. A whopping 90 percent had no idea that HSUS gives only 1 percent of their donations to shelters, and 80 percent agreed that HSUS misleads people. And if they knew that Wayne was funding the executive pension plan at HSUS with millions more than the group has given to shelters, more than a few donors would be screaming for his head.

Q. The less than 1% donation to local animal shelters notwithstanding, would you go discuss the other items in the tax return that troubled you?

A. HSUS devoted nearly 40 percent of its budget to fundraising-related expenses. That’s nearly $50 million, and it’s one reason HSUS is known in some circles as a “factory fundraiser.”

We’re not the only one taking note of this massive HSUS overhead. The nationally respected American Institute of Philanthropy gives HSUS an unflattering “D” grade and calculates that up to 50 percent of HSUS’s expenses are overhead. AIP’s executive director recently said of HSUS: “If you like getting those mailings and want to pay for more of them, support [HSUS]. If you want to give more for programs or services that benefit animals and advocate better rules and protections for animals, they are not a good target.”

HSUS says that it is “approved” by the Better Business Bureau, but readers should know that this is more Wayne Pacelle misdirection. Last week, USA Today reported that the BBB’s charity rating system is under fire from experts for taking money from the very groups it rates, raising serious questions about conflict of interest. HSUS pays the BBB thousands of dollars a year. U.S. Senator Richard Blumenthal (D-Conn.) says this system “unquestionably” has implications regarding “credibility and possible conflicts of interest.”

Lastly, HSUS spent almost half its budget in 2011 on “advocacy and public policy.” This has caught the attention of U.S. Congressmen. In 2010, six Members of Congress wrote the IRS Inspector General citing this spending on advocacy and public policy as reason to believe HSUS may be violating its tax-exempt status.

We challenged Pacelle nearly three years ago to take the “50 percent pledge” and spend half of HSUS’s budget on pet shelters. We offered to close down HumaneWatch if he made good on that challenge. So far, we’ve heard nothing but silence from him.

Q. Pacelle also defended the size of his organization, claiming it was close to 11,000,000 and shouldn’t be limited to the slightly more than half a million who subscribe to their magazine, “All Animals.” There is no doubt that regardless of membership size, HSUS wields considerable political and social clout. Given their influence, does its actual size matter?

A. If HSUS is inflating its membership by 2,000 percent, then that certainly speaks to the lack of credibility of Wayne Pacelle and his minions. The difference between 500,000 and 11 million is considerable when it comes to walking into a legislator’s office.

Semantics aside, what does HSUS mean when it says its “constituency” is 11 million? We surfaced internal HSUS documents from the late 80s that show that about 34 percent of this figure was “prospects.”

HSUS’s actual size only matters because it shows how large this scam has gotten. Given the well documented gap between what Wayne Pacelle wants—a vegan world—and what his donors think they’re funding, it’s a big education opportunity.

Q. I asked Pacelle about the HSUS relationship with Quadriga Art and Infocision Management, two organizations accused of questionable practices. I was disappointed that he didn’t answer the question directly. Let’s go into some detail here – what are the accusations leveled at these two companies and what is the impact HSUS?

A. Wayne Pacelle didn’t respond directly to a question? I’m shocked.In all seriousness, this is yet another strike against the “factory fundraising” culture at HSUS.

Bloomberg exposed InfoCision this fall. Essentially, charities apparently entered into telemarketing contracts whereby InfoCision would build donor lists for them but in the short term keep most or all of the money raised. However, authorities figured out that the donors were being misled about where their money was going.

HSUS appears to have engaged in this deception. According to government filings, one California telemarketer working for HSUS was only sending 2 percent of the money it raised to HSUS, yet according to the script was telling donors that it was 40-50 percent. (Since charities sign off on these scripts, they should be considered complicit.)

As for Quadriga, CNN’s Anderson Cooper exposed this consulting and direct-mail firm for taking in the vast majority of money raised by two veterans charities and an animal organization. The Senate Finance Committee is apparently looking into this, as are the attorneys general of two states. HSUS paid Quadriga about $25 million in 2009-2011.

Q. Thousands of people read CattleNetwork.com. What would you like to say to them?

A. To the farmers and ranchers: Keep doing what you’re doing. You’re vital to this country, and I doubt Wayne Pacelle has ever milked a cow or braved the Midwest winter at 5 a.m. to care for farm animals.

To all: HSUS may seem tough, but remember that it’s a defendant in a federal racketeering lawsuit, has drawn the ire of Congressmen and state political leaders, and in 2011 the amount of money HSUS raised decreased almost 7 percent.

Stand strong, stand together, and stay on offense. These campaigns take time but as long as you don’t tire prematurely you will prevail.

Chuck Jolley is a free lance writer, based in Kansas City, who covers a wide range of ag industry topics for Vance Publishing.